CLAREMONT — Claremont Housing Authority Executive Director Michelle Aiken told residents at Marion L. Phillips Apartments that they will not be displaced should the autonomous corporation reclassify to a private entity.
Aiken met with residents on Friday to answer questions about a proposed plan to convert Marion L. Phillips Apartments to a project-based voucher (PBV) system, which Aiken said will provide more financial stability and predictability.
Marion L. Phillips Apartments is a 96-unit public housing complex that serves low-income seniors and people with disabilities, most of whom receive Section 8 subsidies toward their rent. The U.S. Department of Housing and Urban Development (HUD) pays Marion L. Phillips Apartments a monthly operating subsidy and capital fund. But under the current tenant-based formula, the year-to-year payouts from HUD are more difficult to predict and fluctuate more widely, Aiken explained.
“Every month I get a notice [from HUD] saying I have an operating subsidy that I can draw down,” Aiken said. “It might be $10,000 or $23,000. I never know what it’s going to be or how much I’m supposed to draw down, because every once in a while they’ll put $50,000 in there and I don’t know if that amount is for one month or three.”
It’s a similar problem with the capital fund, where one year Marion L. Phillips Apartments might receive $90,000 from HUD and another year more than $200,000, according to Aiken.
“We don’t know what we’re going to get, and it makes it hard to budget and plan,” Aiken said.
Under the proposed plan, Marion L. Phillips Apartments will change all its rents to a fair-market rate, meaning that the tenant will pay either the unit’s fair market value or 30% of the tenant’s income, whichever is lower.
“If an efficiency apartment is $700, right now we’re at about $650, so we’re cheating ourselves,” said Aiken. “When we convert we’ll get that [$700], but everybody will still pay that 30%.”
Nine units in the complex currently has a flat rent, and Aiken said that only five of those tenants may see a rate increase. The rest of the tenants will continue to pay the same rate as before, with the only change being the type of subsidy voucher.
Tenants presently have “tenant-based vouchers,” which the tenant may use to rent any apartment that meets program qualifications. These vouchers “follow the tenant,” meaning that if the tenant moves to a new apartment building, the subsidy moves to the new building too.
Under the proposed plan, Marion L. Phillips Apartments will convert to PBV. In contrast to tenant-based vouchers, PBVs attach to the unit. If a tenant in a PBV-unit moves out, another low-income tenant who takes over that unit will receive the rent subsidy.
Aiken told residents that this conversion, if approved by the Housing Authority Commission, will not jeopardize their residency. But under HUD’s program guidelines, every household in Marion L. Phillips Apartments will be asked whether they intend to remain at the public housing complex once the conversion is complete or intend to move elsewhere. Residents who declare an intent to stay will be encouraged to accept a PBV. The PBV will not change the tenant’s rate, though should the tenant eventually move he or she may have to reapply for a Section 8 subsidy.
Residents who believe they intend to move will be offered a tenant protection voucher (TPV), a tenant-based voucher intended to assist a low-income person during a transition. Aiken said that the tenants may continue renting at Marion L. Phillips Apartments in the interim, though directors will continue asking the tenant about his or her plans.
“Because the TPV is not part of our program, it doesn’t keep our building stable,” Aiken told residents. “Having every apartment here with a PBV makes us really financially stable. So we’re going to remind you that we need you to make a decision, because you’ll be hurting us.”
After the meeting, Aiken explained that converting the Housing Authority to a limited liability company (LLC) is more of a formality, and will not impact the Housing Authority’s function or services.
“HUD has [a rule] where they won’t pay a Housing Authority as a landlord, even they do it already with public housing,” Aiken said. “They make you pay someone else. We’ll have to sell the building for a dollar to Marion L. Phillips Apartments LLC so HUD will pay us, so we will pay them.”
This decision to reclassify originated from the Housing Authority’s plan to appropriate 10 of its allotted HUD vouchers to the Goddard building, which plans to provide 36 apartments on Pleasant Street, with nine market-rate units and 27 apartments for low-income individuals and families.
Aiken held the meeting with residents as the last-day opportunity of a 45-day window to collect resident feedback and answer questions, which began on Dec. 19. The Housing Authority Commission must still approve the plan, which Aiken hopes to happen in August. Pending the commission’s approval, the conversion could take effect in October.